Quantum Index ETF

[gbharani]

Was going through a mailer regarding the above fund.

http://www.quantumamc.com/schemes/qif.html

How does this work.

Suppose I invest 50000 into the fund, i get 100 units which are then listed on stock market for people to buy and sell ? How would the price be determined.

thanks for your help

regards
Bharani

[gbharani]

guys... any thoughts on this ?

[moneygurukul]

Originally Posted by gbharani

Was going through a mailer regarding the above fund.

http://www.quantumamc.com/schemes/qif.html

How does this work.

Suppose I invest 50000 into the fund, i get 100 units which are then listed on stock market for people to buy and sell ? How would the price be determined.

thanks for your help

regards
Bharani

As it's a Index Fund, the NAV will reflect the value of Index directly. For example, if there are total 100 units in the fund on the day of listing represented by NIFTY level of 5000, then the NAV of one unit will be Rs. 50.
If NIFTY moves to 5500, the NAV will move to 55 and if it goes down to 4500, the NAV will be 45.

However, instead of going through this indirect route, the investors may directly buy NIFTYBEES (NIFTY ETF) from the exchange without any restriction as to withdrawal,etc. Further, As NAV of a fund is calculated on Closing Price basis, even if an investor has sold his exchange traded Index fund (ETIF) during the day at higher price, the redemption will take place only at closing price. With NIFTY ETF, the investor will be able to realize the price the units were actually sold for.

[gbharani]

thank you.